XM, WCS Wireless Terminate Agreement

Not all announced deals close. XM Satellite Radio is not going to acquire WCS Wireless after all. The companies have terminated their agreement because quick regulatory approval wasn't forthcoming. WCS Wireless has wireless spectrum licenses in areas that cover 163 million Americans including 15 of the top 20 metropolitan markets. Its licenses include "10 megahertz in the frequency bands adjacent to XM's satellite radio service," according to the firms. When the deal was announced last July, the companies had expected it to close by this time, subject to government approval. XM had said the acquisition would give it an opportunity to expand its business with multimedia subscription offerings, including video and data, transmitted over the new frequencies. That approval hasn't happened, and now WCS Wireless is free to pursue other alternatives for its spectrum licenses. NAB had asked the FCC to sidetrack the deal; it believed XM would use the spectrum to provide local service and bundle that with its national service. The satcaster told the commission it would use the wireless frequencies to provide "new subscription mobile multimedia services." These would not be broadcast services because they are not free, argued XM.